MLM are legible businesses but one should take care not to fall for scams. A genuine MLM will sell products to consumers without requiring them to join the distribution network. However a MLM scam on the other hand would pressurise a consumer to join. Genuine MLMs pay sales commissions based on the performance of each distributor and their main goal is to promote the sale of a product.

MLM scams operate a little differently from the genuine MLM. Here is a look at some of the characteristics that MLM scams possess.

- It is similar to the pyramid scam; there are no physical products up for sale even though the advertisements carry a range of products.

- Commissions are not paid for recruiting new distributors or members.

- Investors are tempted using methods where quick returns are promised for their investments

- Money that that is collected from new members is used to pay off the existing members. That's why there is additional pressure for a person to join

- These existing members do not get all their money back; they only get a part of it. The rest is with the scammer/s.

- Keep an eye on companies that promise high and quick returns for your investment.

- You don't need to buy into a product that is already selling. This is a scam

- Costly training seminars that offer instant success with the MLM scheme by scammers. Scammers often get participants to pay a huge fee to participate in seminars and workshops but these training programs hardly have anything to look forward to.

MLM scammers use celebrities and other popular characters to promote their scheme.Reality these popular people or celebrities are in no way connected to the MLM scam at all. It is all bogus and is only used as an advertising gimmick.

The truth about an MLM scam is that only the person on top makes the money. Others are just used as pawns to appropriate money and move the funds around.

MLM scams are marketed to people who are trying desperately to make a few bucks. It is not that they are naïve its just that they want to make more money due to various commitments such as housing, mortgages, lay-offs and family issues.

Those who spot the MLM scam early do get out of it but the others simply wait and wait thinking that everything will work out or it may get better. No amount of waiting can ever make a MLM scam better or the victim feel any better. There can never be a down line to the distribution network if there is a high level of drop outs.

Scammers usually use different types of products in an MLM scam. For example, if they promote product A and feel that the down lines and the distribution network as whole is not doing well they switch on to the next product and start the process all over again.

MLM scams are dangerous,.You don't get your money back and those who promote these as a legitimate opportunity is usually a friend who did not know any better than you that it was a scam.